Cardano’s price has been rising for the past three weeks in a row, reaching its highest level since March this year. The ADA token was trading at $0.7940 on Tuesday morning, up 170% from its lowest level this year.
Cardano price is at an inflection point
The weekly chart shows that the price of ADA has been in a steady upward trend over the past few weeks. This rally began after the coin bottomed at $0.3022, where it formed a double bottom pattern, a popular bullish sign.
It has now rallied and found resistance at $0.7941, where it struggled to move higher in March. This price is several pips below the 23.6% Fibonacci retracement level.
Cardano also formed something similar to a cup and handle pattern, a popular bullish sign in the market. This pattern is characterized by a rounded bottom and some consolidation or pullback at the top.
The MACD indicator just rose slightly above the zero line, and the relative strength index (RSI) pointed higher and moved into overbought levels.
Thus, Cardano price is likely to achieve a strong bullish breakout in the coming days. If this happens, the next point to watch would be the 38.2% Fibonacci retracement level at $1.333, which is about 76% higher than the current level.
The bullish outlook will be invalidated if the ADA token falls below the 50-week moving average at $0.4425. Such a move will increase the likelihood of the token falling to its year-to-date low of $0.2350.
ADA chart from TradingView
What affects the price of ADA?
Cardano is growing rapidly for several reasons. First, this surge is consistent with the cryptocurrency’s ongoing comeback, as evidenced by Bitcoin’s rise to over $92,000. Analysts believe Bitcoin has greater upside potential, potentially to $100,000 and beyond. Historically, altcoins like Cardano do well when BTC rises.
Secondly, the price of Cardano is also rising due to the continued rise in the value of Solana, which has taken it above $250. These results mean that Solana has become an expensive asset among most retail traders.
As a result, many traders are looking for cryptocurrencies that are trading under $1 to take part in the ongoing bull run. This also explains why popular tokens such as Dogecoin and Ripple have gone parabolic over the past few months.
Third, Cardano’s fundamentals are improving. Cardanoscan data shows that the number of transactions has increased to over 99.49 million, meaning that it will soon cross the 100 million mark. At the same time, the number of daily transactions increased from 39,000 earlier this month to 104,000, an increase of 166%.
Additionally, the recent election of Donald Trump has become fuel for Cardano and other cryptocurrencies. First, analysts now expect an easier path for crypto ETFs. If this happens, Cardano will become one of the top ETF coins in 2025.
Trump has stepped up his penetration into the crypto industry. According to the Financial Times, Trump Media & Technology is considering acquiring Bakkt, a company that offers crypto services.
Meanwhile, the Cardano token is backed by the Federal Reserve, which has continued to cut interest rates this year. Risk assets like ADA do well when the Fed eases its policy.
There have been rumors about Cardano’s next steps. First, Charles Hoskinson hinted that he will become a cryptocurrency advisor in the new Trump administration. The administration has not confirmed this, and analysts have doubts.
Hoskinsin also hinted that Cardano would strike a deal with SpaceX, the largest space company in the world. He posted a photo of himself standing next to a SpaceX rocket and hinted that he was about to sign the biggest deal of his life. Again, such a deal has not been confirmed.
To be clear, Cardano is one of the most overvalued cryptocurrencies in the industry because it does not have a growing ecosystem. The trading volume of DeFi TVl and DEX was less than that of other new networks such as Base and Sui.
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